Providing relief to State Bank of India in the case of defaulting Jai Balaji Industries (JBIL), the Calcutta High Court has recalled its winding-up order against the debt-laden steel producer.
In its application filed before the high court, SBI had prayed for recalling the order directing the winding up of JBIL and the official liquidator to take possession of the assets of the company.
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The Calcutta High Court’s winding-up order, dated June 7, against the defaulting company had put SBI, one of the secured financial creditors, in a fix as its insolvency petition against the steelmaker is pending before the National Company Law Tribunal’s (NCLT) Kolkata bench. Starting liquidation proceedings would have put a bar against admission of the bank’s pending insolvency plea by the NCLT.
With the HC recalling its winding-up order on June 21, SBI will now pursue its insolvency plea against the Jai Balaji Group’s flagship company. A hearing of the case is likely early next week at the Kolkata bench of the NCLT, sources close to the development told FE.
An e-mail sent to SBI remained unanswered till the time of going to the press. Aditya Jajodia, chairman and managing director of Jai Balaji Industries, was not available for a comment.
Significantly, the company’s name had featured in the RBI’s second list of large corporate loan defaulters.
According to advocate Sidhartha Sharma, representing Fast and Safe Logistics, one of the operational creditors of JBIL, commencement of liquidation would have helped the defaulting company escape from a possible insolvency proceeding.
The HC had earlier passed the winding-up order against Jai Balaji Group’s flagship company for non-payment of dues of close to `4.70 crore to Kolkata-based Lakhotia Transport Company, an operational creditor, on account of transportation charges of the goods of the company from its factories to various places.
Following this order, SBI filed a plea before the Calcutta HC, urging the court to recall the order as the bank had already filed an application under Section 7 of IBC before the NCLT for initiating corporate insolvency resolution process in respect of JBIL.